Australian Financial Review chief political correspondent

THE Treasury secretary, Martin Parkinson, has repudiated suggestions by the shadow treasurer, Joe Hockey, that his department displayed political bias by conducting unsolicited costings of Coalition policy then leaking them to the media.

In a letter to Mr Hockey on Wednesday, Mr Parkinson said the costings were not unsolicited but were requested by the office of the Treasurer, Wayne Swan.

Nor did Treasury leak them, Mr Parkinson said.

''As is always our practice, the Treasury did not provide the advice or the underlying analysis to anyone outside government,'' he said. ''I can assure you there has been no breach of the professional and apolitical ethos of the Treasury.''

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Mr Hockey has been on the warpath since Monday, when Fairfax Media published Treasury analysis that found three Coalition polices would cost business $4.7 billion in one year and more than $17 billion over four years.

Mr Hockey claimed the government was abusing the Treasury by having it do such work and then giving it to the media, and he suggested the Treasury had lost its independence.

''I am concerned that if Treasury undertook to conduct these unsolicited costings, or subsequently released these costings to the media, the apolitical and non-partisan nature of Treasury has been severely compromised,'' he said in a letter to Mr Parkinson. ''I believe this matter raises serious questions about the impartiality of your department.'' On Wednesday, Mr Hockey said the government was using the public service ''as both a shield and a sword on the political battlefield''.

He said Treasury should ''speak up',' and that if elected, a Coalition government would not use Treasury in this manner.

However, when the Coalition was in government, it would frequently find budget holes in Labor's promises with the assistance of Treasury and Finance.

Mr Hockey said the Coalition never released Treasury minutes - documents from the department detailing its findings.

But the government produced a press release from then treasurer Peter Costello in 2002, saying Labor would blow a multi-billion-dollar hole in the federal budget if it opposed changes to superannuation policy.

The Coalition press release began: ''The Department of Treasury has carried out a preliminary costing of the Labor Party's policy announced last night to oppose the superannuation surcharge tax cut and reduce superannuation contributions tax levels.''

In October 2004, Mr Costello used the Department of Finance to cost Labor's Medicare Gold policy and then condemned the plan as unsustainable.

In January that year, he claimed there was a $2.4 billion hole in Labor costings.

''We do (the costings) ourselves on the basis of the material we have from the official departments, Treasury and Finance,'' he said.

The Prime Minister, Julia Gillard, said it was ''very common'' for governments to have Treasury cost opposition policies.

''I actually think the Australian people are entitled to know what the policies of every political party are and what they would cost,'' she said.

Mr Swan said Mr Hockey was being sensitive and should submit his policies to the newly-established Parliamentary Budget Office, and the independent and professional costing body for oppositions and minor parties.

Mr Hockey said the office was not operating yet, but it is. On the weekend, Fairfax Media published costings the office had done for the Greens.

On Thursday, Mr Swan was unapologetic about the Coalition costings work, saying it was a government-commissioned document and it was up to the government to us it "as it sees fit".

"It's entirely appropriate that that information is released," he told ABC Radio.

"There's nothing unusual about it, because costings go to the core of the current debate."

When asked if he regretted the fact that Treasury had been brought into the debate, he said "this is all the work of Mr Hockey".

"What I regret is the way in which Mr Hockey has sought to politicise the Treasury."